CrowdStrike Tops Views, But Shares Dip; Okta Jumps On Solid Beat

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CrowdStrike Holdings (CRWD) on Wednesday reported July-quarter earnings and revenue that topped Wall Street estimates. Meanwhile, cybersecurity peer Okta (OKTA) delivered a bigger beat. CRWD stock dipped while OKTA stock soared.


CrowdStrike earnings for its fiscal second quarter jumped 105% to 74 cents a share on an adjusted basis. Revenue, including acquisitions, climbed 37% to $731.6 million.

Analysts polled by FactSet had projected earnings of 56 cents a share on revenue of $724 million for the period ended July 31.

A year earlier, the Sunnyvale, Calif.-based firm earned 36 cents a share on revenue of $535 million.

CRWD Stock Reverses After Hours

CrowdStrike stock initially rose on the earnings report, then reversed down in extended trading. CRWD stock dropped 1.5% to 147 in recent action on the stock market today.

With CrowdStrike, Wall Street focuses on annual recurring revenue, or ARR. It’s a key financial metric tied to subscription services growth. During the July quarter, ARR increased 37% to $2.93 billion. Analysts had predicted ARR of $2.92 billion.

“Outside of key metrics, the AI-powered Falcon platform’s native capabilities across cloud, identity and next-gen security monitoring businesses in aggregate are contributing well over half a billion dollars in ending ARR,” RBC Capital analyst Matthew Hedberg said in a note to clients.

For the current quarter ending in October, CrowdStrike predicted revenue of just under $777 million at the midpoint of its outlook. That edged by estimates of $774 million.

OKTA Stock: Outlook Raised

Meanwhile, Okta reported profit of 34 cents, up from a 10-cent loss in the year earlier period. Revenue rose 23% to $556 million. Analysts that follow OKTA stock had predicted 22-cent profit on revenue of $535 million.

Okta raised its full-year revenue outlook, RBC Capital analyst Matthew Hedberg said in a note to clients.

“Fiscal 2024 guidance moved higher for all metrics with midpoint revenue guided to $2.21 billion vs. prior guidance of $2.18 billion, which points to 19% growth,” he said.

OKTA stock popped 11.6% to 82.13.

CrowdStrike’s Specialized Database

CrowdStrike uses machine learning, a form of artificial intelligence, in its products. Further, it uses a specialized database to detect malware on laptops, mobile phones and other devices that access corporate networks.

Heading into the CrowdStrike earnings report, CRWD stock had climbed 40% thus far in 2023. But shares owned an IBD Relative Strength Rating of only 38 out of a best-possible 99, according to IBD Stock Checkup.

Follow Reinhardt Krause on Twitter @reinhardtk_tech for updates on 5G wireless, artificial intelligence, cybersecurity and cloud computing.


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